The Children's Place Reports First Quarter 2012 Results
Management Updates Fiscal 2012 Earnings Guidance
GAAP net income was
During the quarter, the Company undertook several actions to reduce operating costs going forward, including consolidating from three to two US distribution centers, streamlining its field workforce and restructuring corporate headquarters, which it expects will result in annual savings of approximately
Adjusted net income is a non-GAAP measure. The Company believes the excluded transactions are not indicative of the performance of its core business and that by providing this supplemental disclosure to investors it will facilitate comparisons of its past and present performance. A reconciliation of net income as reported is included in this press release in Table 3.
"We made good progress in the first quarter - tightly managing our inventory, reducing expenses and improving operational efficiencies across the organization - and we delivered adjusted earnings per share consistent with last year, in spite of significantly higher product costs," commented
The Company opened 18 stores and closed 5, ending the first quarter with 1,062 stores.
Share Repurchase Program
During the first quarter of fiscal 2012, the Company repurchased 377 thousand shares for
Outlook
The Company updated its guidance to reflect first quarter results and now projects that non-GAAP adjusted earnings per diluted share will be between
The Company provided initial guidance for the second quarter of fiscal 2012, and is forecasting a non-GAAP adjusted loss per share between
This earnings guidance assumes that currency exchange rates will remain where they are today and does not include the impact of further potential share repurchases.
Conference Call Information
About The
Forward Looking Statements
This press release (and the above referenced call) may contain certain forward-looking statements regarding future circumstances, including statements relating to the Company's positioning, and forecasts regarding store openings and earnings per diluted share from continuing operations. These forward-looking statements are based upon the Company's current expectations and assumptions and are subject to various risks and uncertainties that could cause actual results and performance to differ materially. Some of these risks and uncertainties are described in the Company's filings with the
(Tables Follow)
Table 1
THE CHILDREN'S PLACE RETAIL STORES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
First Quarter Ended
April 28, April 30,
2012 2011
Net sales $ 438,508 $ 430,806
Cost of sales 261,721 247,159
Gross profit 176,787 183,647
Selling, general and administrative expenses 122,152 116,722
Asset impairment charges 1,250 398
Other costs 834 --
Depreciation and amortization 17,218 17,751
Operating income 35,333 48,776
Interest (expense), net (51) (271)
Income before taxes 35,282 48,505
Provision for income taxes 11,690 19,421
Net income $ 23,592 $ 29,084
Earnings per common share
Basic $ 0.96 $ 1.11
Diluted $ 0.96 $ 1.10
Weighted average common shares outstanding
Basic 24,535 26,120
Diluted 24,691 26,387
Table 2
THE CHILDREN'S PLACE RETAIL STORES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
April 28, January 28, April 30,
2012 2012* 2011
Assets:
Cash and cash equivalents $ 204,826 $ 176,655 $ 212,347
Accounts receivable 18,656 17,382 21,269
Inventories 193,852 212,916 192,714
Other current assets 55,788 66,372 53,962
Total current assets 473,122 473,325 480,292
Property and equipment, net 329,058 323,863 327,017
Other assets, net 54,423 53,461 57,653
Total assets $ 856,603 $ 850,649 $ 864,962
Liabilities and Stockholders' Equity:
Accounts payable $ 34,784 $ 55,516 $ 23,635
Accrued expenses and other current liabilities 91,990 76,039 83,485
Total current liabilities 126,774 131,555 107,120
Other liabilities 110,606 109,728 122,241
Total liabilities 237,380 241,283 229,361
Stockholders' equity 619,223 609,366 635,601
Total liabilities and stockholders' equity $ 856,603 $ 850,649 $ 864,962
* Derived from the audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended January 28 , 2012.
Table 3
THE CHILDREN'S PLACE RETAIL STORES, INC.
RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION TO GAAP
(In thousands, except per share amounts)
(Unaudited)
First Quarter Ended
April 28, April 30,
2012 2011
Net income $ 23,592 $ 29,084
Non-GAAP adjustments:
Expenses:
Store impairment 1,250 --
West Coast DC exit costs 834 --
Restructuring severance costs 1,971 --
Obsolete supply and fixture costs 719 --
Accelerated depreciation for Canadian store remodels 893 --
Aggregate impact of Non-GAAP items 5,667 --
Income tax effect (2,147) --
Adjusted impact from Non-GAAP items 3,520 --
Adjusted net income $ 27,112 $ 29,084
GAAP net income per diluted share $0.96 $1.10
Adjusted net income per diluted share $1.10 $1.10
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